Why do liberals oppose trickle down economics?
Don't they realize it makes good economic sense? If billionaires get tax cuts then it means they have more money to make jobs and to spend buying things which means more people can be employed and that the economy grows. Taxing the rich like liberals want to do leads to loss of jobs and outsourcing. Since they create jobs for us and buy stuff that goes into the salaries of people that work for companies it trickles down for us. Of course this only works if you give tax cuts and money to the rich, if you give it to the poor they will just abuse it and become entitled on welfare.
- Anonymous11 months agoBest answer
Because trickle down doesn't work. We've seen that empirically in history. It also doesn't make any sense since it violates the rules of capitalism as well as the reality of the world.
Trickle down economics is inherently non-capitalist. In capitalism all economic activity is driven by demand. Trickle down proposes that economic growth can be created in the absence of demand, which is nonsense. Giving more money to the rich doesn't create economic growth for several reasons. On a real world level, people are mostly employed by companies and not by wealthy individuals, so personal income tax cuts for the wealthy aren't going to increase hiring or business investment. On the theoretical level there's two more problems. First is that the rich already have more money than they need, that's why they're rich. So giving them even more money isn't going to spur productive investment. Second, people and businesses don't hire new workers just because they've got extra money sitting around. They only hire workers because they need their labor to meet demand. Absent any demand, you're not going to see investment. That's capitalism 101. Finally, personal spending by the rich simply can't sustain the economy. Rich people do spend more than middle class people, but not so much more that it's in proportion to their income. The median American income is $50,000 a year. Someone making a million dollars a year makes twenty times as much. But that millionaire isn't going to be spending 20 times as much on clothes, or food, or movie tickets, or books. It's simply not going to happen. There are some industries which cater to the rich but they're very marginal employers. The truly big companies sell to the masses and that's where the money is: in he average people as a whole. Economic policies which seek to give more money to the poor, working, and middle classes are much better at stimulating the economy. This is because lower income people actually spend most of the money they get. That's why poor people are poor, because they don't have excess money stashed away. They need more spending power and so when they get more money they actually go out and spend it.
- -j.Lv 711 months ago
Rich people in America are already rich, more so than ever before.
Yet wages are stagnating, the middle class is shrinking, the divide between the rich and everyone else is growing.
If trickle-down is supposed to work, it should be working already. Why isn't it?
- StephenGLv 711 months ago
It doesn’t work, it never has nor will
- Anonymous11 months ago
It doesn't work. That stuff doesn't happen. It's a con. You're a dupe. You've been played.
The period of highest growth in American history was when the top income tax rate ranged from around 70% to over 90%.
The low rates that have prevailed since the '80s have not resulted in increased growth; on the contrary, growth has slowed. The main effect of these low rates is that the rich have more money than they know what to do with and end up "investing" in a series of bubbles, while the rest of us struggle.
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- Anonymous11 months ago
Methinks you are being facetious. Supporters call it supply side economics. Opponents mock it as trickle down. George HW Bush called it voodoo economics during the 1980 Republican primaries.
- JeffreyLv 711 months ago
They oppose it because it leaves money in the hands of the people who earn it rather than forcing them give it to the government.
- BlueNinjaLoveLv 711 months ago
Becasue with increasing greed of rich CEOs and executives it unfortunately does not always happen in the way you want, in the way it should happen in a perfect world.
Given the company I previously worked for filed for bankruptcy in October, I can say that no "trickle down" concept ever worked for that one once that CEO, the one that led to its downfall, took over. They refused to spend money updating or renovating the stores, many were so old looking and in disrepair. They even decided to save money by stopping have any ads over two years ago... Literally come Black Friday 2016 and 2017, there was nothing for that place, no ads to remind anyone that they even existed, let alone any ads the rest of those years. They made horrible decisions that cost many jobs and closed many store, all while playing financial games to benefit themselves and stuff their own pockets.
You know what happened after Trump gave that big tax break to these guys? My store ended up on the chopping block with quite a few others. They get to keep more money in their pockets while a longtime store and our jobs got to end.
And to rub salt in the wound, the bankruptcy court okayed it for them to give the executives millions of dollars in bonuses... despite their destroying a longtime company. And even though the CEO has stepped down, he and his hedge fund that was a huge part of killing it still involved and he'll still benefit as much as he can as they kill it off and sell the properties.
So yeah... "trickle down" only happens in a perfect world where the people at the top are not only in it for themselves and actually care about the company, not just their own bank account.
- BeardogLv 711 months ago
Because that’s not what happens. The rich didn’t get rich by increasing their spending every time they increase their income.
- I'm Always WriteLv 711 months ago
Trump pockets it all. That's the problem
- abraXusLv 711 months ago
are you drunk? or just really stupid?